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Credence goods, costly diagnosis, and subjective evaluation

Bester, Helmut; Dahm, Matthias - 2014

We study contracting between a consumer and an expert. The expert can invest in diagnosis to obtain a noisy signal about whether a low-cost service is sufficient or whether a high-cost treatment is required to solve the consumerś problem. This involves moral hazard because diagnosis effort and...

Persistent link: https://www.econbiz.de/10010429934

Spin doctors : an experiment on vague disclosure

Deversi, Marvin; Ispano, Alessandro; Schwardmann, Peter - 2021

information transmission. We find that vagueness is profitably deployed by senders to fool those receivers that lack strategic … precision are not obvious. However, our model and experiment show that information transmission and the welfare of naive …-relevant information, the disclosure of research findings, and testimonies in a court of law. …

Persistent link: https://www.econbiz.de/10013191455

Cursed consumers and the effectiveness of consumer protection policies

Ispano, Alessandro; Schwardmann, Peter - 2021

We model firms’ quality disclosure and pricing in the presence of cursed consumers, who fail to be sufficiently skeptical about undisclosed quality. We show that cursed consumers are exploited in duopoly markets if firms are vertically differentiated, if there are few cursed consumers, and if...

Persistent link: https://www.econbiz.de/10013191460

Can a bonus overcome moral hazard? : an experiment on voluntary payments, competition, and reputation in markets for expert services

Angelova, Vera; Regner, Tobias - 2017

Interactions between players with private information and opposed interests are often prone to bad advice and …

Persistent link: https://www.econbiz.de/10011697162

Congestion, Coordination and Matching

Halko, Marja-Liisa; Salonen, Hannu - 2008

We study the existence of pure strategy Nash equilibria in finite congestion and coordination games. Player set is divided into two disjoint groups, called men and women. A man choosing an action a is better off if the number of other men choosing a decreases, or if the number of women choosing...

Persistent link: https://www.econbiz.de/10012502982

The impact of social media on belief formation

Schwarz, Marco - 2017

information, and how they form beliefs. Experts are concerned that the rise of social media may make interaction and information …

Persistent link: https://www.econbiz.de/10011762816

Do legal standards affect ethical concerns of consumers?

Danz, David; Engelmann, Dirk; Kübler, Dorothea - 2020

To address the impact of regulation on ethical concerns of consumers, we study the example of minimum wages. In our experimental market, consumers have monopsony power, firms set prices and wages, and workers are passive recipients of a wage payment. We find that the majority of consumers...

Persistent link: https://www.econbiz.de/10012236843

Cross-game learning and cognitive ability in auctions

Giebe, Thomas; Ivanova-Stenzel, Radosveta; Kocher, Martin; … - 2022

Overbidding in sealed-bid second-price auctions (SPAs) has been shown to be persistent and associated with cognitive ability. We study experimentally to what extent cross-game learning can reduce overbidding in SPAs, taking into account cognitive skills. Employing an order-balanced design, we...

Persistent link: https://www.econbiz.de/10014476711

Behavioral implementation without unanimity

Korpela, Ville; Lombardi, Michele; Zachariassen, Julius - 2024

behavioral implementation under complete information without assuming Unanimity. Moreover, we give a full characterization of …

Persistent link: https://www.econbiz.de/10014551784

All Deceptions Are Not Alike: Bayesian Mechanism Design with Social Norm Against Lying

Korpela, Ville - 2014

We say that a society has a weak norm against lying if, all other things being equal, agents rather lie in such a way that they do not get caught. We show that if this is the case, and it usually is, then Bayesian monotonicity is no longer a constraint in implementation and all incentive...

Persistent link: https://www.econbiz.de/10012503049

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